LGUs can use the PPP program to build government administrative centers, instead of using their budgets for these. The private proponent usually integrates high-technology building systems into the physical structure, such as electrical raceways, computer network, fiber optics, etc., making it a "smart" building. Most of the space will be used for offices of national and local government offices, and the rest can be allocated for private concessionaires. In the example in volume 3, the proposed scheme is a build-lease-transfer arrangement. The private developer will construct the building in a public land, arrange for the lease of office space to the LGU and national government agencies, manage the building, and then turn it over to the LGU after an agreed period of time. To improve the viability of the project, space will be allocated for lease to the private sector. The LGU will not have a share in revenues during the concession period. Below are highlights of the proponent and the LGU's responsibilities.
Private Proponent | |
● Design, finance, build and operate and maintain the facility ● Provide construction warranties and operation performance bond ● Collect fees, rentals and other charges not exceeding the amounts proposed in the bid ● Prior to transfer to the LGU, train LGU staff on the operation of the center | ● Pay lease for the office space to the developer ● Issue exclusive franchise ● Provide site for the building ● Provide tax incentives such as deferment of real property and business taxes ● Provide termination/buy out payment, if contract is cancelled due to LGU's fault |